Personally I feel like the difference between selling now and in the spring is minimal as you will encounter the same concerns with buyers both times.

(I feel like buyers will be scared off that something is wrong if we sell right away)

As a buyer, I would be....

I routinely check the county's assessment website on all lots I am interested in, and I study owner history. If I saw a piece of land that was owned for a few decades, sold to someone with a different surname, and then suddenly sold within a year or two, I'd be nervous that there was something *wrong* with the lot, making it unbuildable. But, I'm more than a bit odd, so take that into consideration, lol!

To be completely honest though, if it's sloped enough that terraforming (bringing in dirt and changing the natural landscape) is being considered, I wouldn't buy it, anyway. :-( (The style of house I want to build pretty much requires minimal slope, and I am unwilling to fight Earth's natural form that much.)

should we build and use it as our practice home?

That's not a half-bad idea; I'd only encourage y'all to work *with* the slope, instead of against it. :-D

Do you need to sell this lot to buy/build on another lot? They aren't making any more land, right! Might be a good "investment" to hold the lot for a couple of years, but I don't know your market and certainly don't know where the RE markets are going!

Although your circumstances are now changed for the better. Is there a chance it could change back? If so building there and staying for a while might not be a bad idea so you can save up and be on complete solid footings going forward. I like the idea of a practice house.

Check on the tax ramifications of selling so quickly.

If you don't want the land sell it now, you have no crystal ball to say what conditions will be like in the spring. Buyer beware, any problem will be the buyers problem if they don't do their own due diligence. All you need to disclose is if the land is buildable based on what the city tells you.

I'd also leave the land the way it is and don't cut down any trees. Tree's add value and some could be incorporated into a potential buyer's design. And DO NOT FILL. You could easily ruin the value of the lot if the fill isn't correct and specified by a civil engineer, don't mess with it. People don't build on any old fill, it must be correctly selected and compacted so let any buyer determine what and how the land will be used, not you.

Not trying to preach here but do you have an insurance liability policy on the lot? If anyone gets hurt on your vacant lot the first thing they do is look for someone to sue. Posting NO TRESPASSING signs may help protect you from lawsuits. A parcel without a sign is equivalent to an invitation by you to help yourself, and people can't be charged with trespassing, but only asked to leave. If a squatter sets up a homestead on your lot he may not want to leave and could involve a legal evction to remove the squatter(s). Not fun.

we are in the same exact situation. For us, we decided to build because the location of the lot we just bought is excellent. What’s most important for you? lot size? convenient location? also, which location would be the best for resale? If we build on our lot we just bought , we would make 50% more if we sell it after it is built. what do YOU want most? :)

Thanks everyone for the input!

@One Devoted Dame I am 100% the same in digging for all info on a property so I too would be very suspicious about a quick flip. Wasnt sure if i am the exception or if most other buyers do that kind of research and think the same way.

@homechef59 we did consider clearing it either way, though I was concerned it may look MORE suspicious if we start the process - does it look like we hit a snag and are trying to run away vs just changing our mind.

My main motivation to sell is that the lot wont be great for small children and taxes are high. We knew that going in but all things considered we felt it the pros > cons. Since then we have had a notable boost in salary (can now afford more long term) , we were able to sell our old home for a very good profit and were given the opportunity to ”rent” a home that was recently inherited by our parents that fills all our needs right now and is cheap.

So my thought is id rather just stay here and save up for something ”better”. There is no rush but Id love to have the cash vs the asset so we can jump if/when the better opportubity arises.

I don't know anything about your market, so our situation may not be applicable. Having said that, in the current environment I don't hear people questioning the quick turnover of property the way they may have two years ago. Some will assume it's due to a job loss instead of your improved finances. Other assumptions may be made, too. Once I reach a decision about something, I tend to want to act rather than wait.

As for the slope, in our current area that's become more common as nearly all of the flat land that isn't in a flood zone has been purchased. We ended up demolishing an existing house in order to build because it was the only way to obtain a good size (over an acre) fairly flat lot. Our only other options were sloping lots suited to walk-out basements, which many people here would prefer.

Both in our current and former locations, higher property taxes never seemed to be an impediment to a sale. Perhaps that's because they were associated with the best schools in each region.

With all of the hassles of building during a pandemic (we have lousy timing), if I were in your shoes I would sell the lot and focus on the future. Maybe by the time you find the land you really want the supply chain problems will have mostly been worked out and your build will be less stressful.

Sell it and be ready to go in the future. Questions can be answered. Having access to that cash frees you up to act on another piece of land that might be perfect.

I agree with @just_janni. We bought a beach lot in Mexico in an area we fell in love with. One year later, we weren't so in love with the area, reality had set in. So, we put it on the market. We lost a little $ (not too much), and it took awhile to sell, but sell it did, and now we are building on 10 wooded acres in North Carolina, which is really where we belong. We have no regrets.

Bird in the hand vs. 2 in the bush (?)

How likely is it that a better lot is out there? Have you actually seen a better lot you would have bought if you had the money?

Having gone down this road several times for myself, my answer is that it all depends - too many variables for me to know what you should do.

Building a new home eats up SO MUCH MONEY. Sorry for yelling, LOL - but man, everything just costs so much more than anyone ever expects it will. So should you keep this "cheaper" lot and just know you can eventually build a nicer house on it?

Buildable land has been like a treasure hunt for me in the past. However I have no idea what sort of land options exist around you. There have been times I wanted to build new, but literally could not find any land that I would even consider buying.

If the taxes aren't too bad on the vacant lot, I'd keep it for now. But that's just me.

@User - i suppose ”better” is subjective. For context, we paid 117k, there is a tract home subdivision a few minutes away- lots are same price but a little smaller, closer to 1/4-1/3 acre and flat. IMO our lot is more desirable despite the slope simply because you can build any home with any builder. Also, we are at the top/end of a one way ”circle” with a wooded center median that is very private. I should add tho the lot slopes down from the street so there is some extra expense there to fill and grade it.

We would be looking at the $150k+ range for an acre more toward the outskirts. Plus well and septic cost (our lot is city water/sewer) which im now thinking would probably be offset in the monthly payment by tax savings from being outside the city. For reference, this is still the suburbs so outside the “city” is like 5-10 min away.

Right now there are probably only a handful of these for sale right now, especially small pool of options that dont require us to use a specific builder or to build a huge (cost prohibitive) home.

Based on what you just wrote, I say hang on it. But you're getting a lot of my personal preferences wrapped up in there. I'd far prefer a bigger lot in an established neighborhood than a tract build or subdivision of McMansions.

If you're in the construction business, build a simply designed spec house on the lot, and then sell it. Spec means everything chosen by market appeal, not personal taste and wants. That personal taste and wants is what makes a house cost mega money more than it will appraise for.

If you can’t rigidly control your splurges on spec, then you’ll just have to move in and sell it in 2 years. But that should tell you not to build if you can’t be unemotionally involved and make the spec math work. You can make some good money on spec, in the right circumstances. Enough to upgrade that eventual dream house pretty nicely.

The best time to sell a lot or land can differ from the best time of year to sell a house. Some of it's location specific and depends on the climate.

In my part of the Midwest more lots and land sell in the fall and winter months than the summer. There are a few reasons for that. First, wooded lots are easier to walk and see with the leaves and any brush dead for the winter. Even wit flat lots or land it's easier to see contours, size, etc. with dead grass or brush. Second, lots of people start to look for lots in October/November with a plan on starting to build in the Spring. We built twice. The first time we started looking for a lot in late fall. We found something by December. The next time we looked in February and signed the contract that month.

@rrah I am in the midwest as well and that was my thought exactly. That while reselling SO soon might turn off some buyers, Fall is ideal timing for a buyer to have enough time to plan the build before Spring. I also totally agree that the dead brush makes it much easier to walk and understand the grade.

@User my husband is leaning in that direction- building a spec house and living there even if only for a few years. I think he also just really wants to do a build as a learning experience.

All great feedback here.. we have a lot to think about.

I don't think that selling a lot soon after buying is going to mean anything to buyers. it is incredibly common. People tend to buy lots before they price out a house, building usually costs more than people expect and so after further research they will resell. I suspect most sizable custom home developments see people own lots for a short time before selling again.

You barely paid a thing for it. Just sell and buy what you want. Sometimes I can’t even believe the variety in prices. Almost shocking really.

The market for lots is small. Put it up for sale as soon as you can.

You don’t know, what you don’t know. It’s a seller market. Who knows what the variables will be in the Spring. This hot buyer’s market will cool off big time with continued inflation, interest rates going up, taxes going up, etc. Sell now. Then, look at investing in a diversified portfolio that includes a real estate component. Seek a good fiduciary investment firm. One that doesn’t get commissions from selling specific instruments but you pay a fee to based on the portfolio performance. Make this part of your long term retirement investment strategy. Wait to buy when market becomes a buyer market and only when you truly want to start building. With your current living situation, save as much now as you can. Golden opportunity. No “practice” building.

I am not a pro and I have never built my home from the ground up. I think Houzzers are a unique bunch and most Americans just want a house that is DONE. I don’t know your market but here in the greater Nashville area there is so little land in the desirable school districts just flipping the land is easy. However, for your own life, you need to figure out if building a spec house (super neutral as has been recommended) and living in it will be a good education on what your own dream house would be. If you want to sell the land, make sure to have it perked so you can list it as ready for X number of bedrooms. (People are so nutty here about buying land that a friend of mine knows someone with tons of unbuildable land. She just snapped it up without doing her due diligence.)
Do what is best for your family and your own financial situation. I think you’re in a win win situation.

My 2 cents...

If you don't think the land is ideal for your needs sell it. Building a house is stressful and difficult enough without starting the process off with a piece of land that doesn't work great for you.

Building a spec home is a waste of your time and a risk not worth taking for several reasons. First, you are paying the education tax on a house you don't want to live in. For example, suppose you learn that something you really like ends up costing $20,000 more than you thought it would and now you know it isn't worth the extra money. You are still out the $20,000 for that feature and now it is in the spec house you are going to sell. That lesson would cost the same in the house you are really going to live in and you would have it.

Next, the knowledge you really need is design knowledge and building a house will not get you a better designed house next time. My advice is to add time and money to the design phase, that is where your satisfaction is really created.

Finally, it is stressful and there is no reason to undergo that type of stress because you think it might be of some educational value. I also wouldn't recommend a practice colonoscopy a couple of weeks before the real thing.

As for timing the housing/stock market to buy when prices go down... It generally doesn't work so don't bother. For the equity market, the trick is to get your money in as soon as you can and let it set for as long as you can and I suspect the same holds true for housing. This is not to say you shouldn't consider the market condition in your decision, just that timing the market has generally bad results.

@Flo Mangan great advice. Original plan was to start building next Spring but now landing in a very comfy spot both financially and in our living situation, my thoughts are the same as yours- market is already cooling here (feels like we sold JUST in time) and possibilities feel endless compared to 6-9 months ago. Bigger budget + no debt + secured great profit from home sale + home prices softening + complete flexibility on when we make a move (not tied down to a mortgage or lease) feels like a golden opportunity for sure.

Also thinking we dont have much to lose by just listing it (For sale by owner or flat rate MLS listing??) If no buyers then I guess the decision is made for us. Then we sit on it or build to sell if it comes to that.

Flat rate MLS listing. FSBO is unlikely to get the number of eyeballs on the property. Sure, people do it all the time. But, I doubt that many willing buyers or their friends and relatives are going to be driving down the street.

When asked why are you selling, tell them you changed your mind. Don't expect to make a killing off the lot. Everyone can see what you paid. Undeveloped land is different from houses. If you can break even after costs, you are doing good.

@homechef59 we are definitly not expecting to profit. In fact, very likely we’d take a small loss once you consider buying/selling expenses. If we couldnt sell for what we paid (or very close to) we wouldnt sell right now.

You are correct that we cant rely on anyone driving by, its on a one way circle with a wooded median so you cant even see it from the main road and the only people driving past would be the neighbors… The more I describe it, the more Im reminded why I bought lol.

@bry911 all good points.

@RedRyder i dont think we need a perc b/c the lot is city sewer/water right at the road. It should be a pretty safe buy being a ”city” lot- confirmed to be buildable with very modest size requirements and while you never know what youll find when you dig, all land around it is developed so that made me feel comfirtsble at least.

Im definitely leaning away from building unless we want to live there longer term. Moving is a pain and we have much less flexibility once our money is tied back up in a mortgage. I also dont want to keep changing schools for our kids.

Ok. With all that, just “inventory” it. That means just hold it. In a couple years, then list it. Unless you are cash strapped. If so, list it right away. Take your lumps. First lesson learned! Lol.

The amount paid for land and subsequently the loss are sunk costs and shouldn't factor into the decision.

E.g. Suppose you can sell land for $120,000 today or sell it for $140,000 in five years. The only material question is, "can you make a better return than $20,000 in five years by investing the money, avoiding taxes, and avoiding interest?" That remains true regardless of whether or not you paid $110,000 or $130,000 for the land.

Probably an easier way to think of it: never keep an investment that you wouldn't buy today for the cash you can get from selling it.

Furthermore, you can take up to $3,000 of the loss per year as a deduction of income and carry it forward until the loss is used up.

I would say list it with a LOCAL RE agent, who can show you the land.

@bry911 good call on the carrying costs. I agree I wont hold it just to save or make a few thousand dollars. That amount can easily be made up or lost a hundred different ways over the next few years. Also very good tip on deducting losses.

@mtvhike I have to disgree on the RE agent, I‘m not sure an agent brings much value to this type of transaction but perhaps im missing something.

Get it on the MLS for a bit higher price than you hope to get. See if you get any takers at list price. You don't owe any money until it sells and if you don't get a full price offer, you aren't obligated to sell. You may be surprised to find a buyer who is thrilled with that particular lot

With the cost and uncertainty in building now, I wouldn't even consider building unless you intend to stay there for many years.